DEVON should scrap its current plans to modernise care services for older people and consider all the options, a leading Teignbridge councillor has said.

On Tuesday it was confirmed that the recession had scuppered the planned £100 million transfer of 24 county council care homes to private firm Shaw Healthcare.

The news affects Newton Abbot, Ashburton, Bovey Tracey and Dawlish, which had been promised new and improved facilities.

Those plans are now left hanging in the air with no hope of a clearer picture emerging until at least the spring.

Shaw withdrew its offer to modernise the service and create 1,000 beds after it told Devon County Council it could not raise the funds.

It has refused to talk to the press.

At a meeting of the council's executive at County Hall on Tuesday, it was agreed to enter into new negotiations with the firm to undertake a development of up to 190 care beds.

Shaw will also have to demonstrate better value for money for its proposal to develop extra care housing.

Other potential providers will be invited to negotiate terms for the remaining services.

But first the executive wants to hear from the health overview and scrutiny committee, the body which advises on such matters.

Cllr Hugo Barton, executive member for adult and community services, said: 'It is important that... their views are understood and taken into account.

'Clearly the situation today is ­l From page 1

driven by the current economic downturn.  In many ways though, it presents us with opportunities to spread our risk with more than a single provider. It enables us to look at individual locations and to address local needs, and there are other potential partners now available to us.'

The chairman of the committee, Buckfastleigh member Cllr Stuart Barker, said his colleagues' long-standing concerns about Shaw's ability to deliver had been borne out.

'At the meeting we recommended to the executive that they withdraw from further negotiations with Shaw,' he said.

'This is an ideal opportunity to revisit the whole issue about modernising services.

'Speaking as a Conservative, I can say that our party wouldn't do what the county is proposing. There are other options not being properly considered such as working with the existing private sector.

'I'm sure that if we told them what we wanted and offered long-term contracts, many would be quick to provide and it could be achieved without a major capital investment by the county.

'Then there is the matter of management buy-outs. We have some excellent and committed care managers who could easily run their own businesses given the right opportunity.'

The county council has promised 'extensive community consultation' in the new year.